Kogan Imposing Tax On Shoppers Who Use IE7

Online electronics retailer Kogan is no stranger to novel pricing approaches, but this one takes the cake: from now on, anyone who visits the Kogan site using IE7 will be charged an additional 6.8% “IE7 tax” — 0.1% for each month since the browser was released — on any purchases.

Visitors to the site who use IE7 will see a pop-up message suggesting that they install a “better browser”, with links to Chrome, Firefox, Safari and Opera (though not to IE9). In a blog post announcing the change, founder Ruslan Kogan says that the cost of making the site render properly on IE7 isn’t worth the hassle.

Microsoft itself has worked hard to persuade users to upgrade as part of general system patches, and as we’ve noted recently, the current Internet Explorer 9 release performs much better than you might think. We’re not sure how many actual customers this will impact, but driving bargain shoppers towards using a more modern browser is no bad thing. I can’t imagine anyone choosing to pay extra and sticking with IE7, but if it does happen, I’m sure we’ll hear about it.

Have to agree with you mate. So many tech-unsavvy people out there. If a system admin gets wind of their users wanting a change away from the worst browser the world has ever known, I think they might just oblige. Or they're just the worst tech money can waste.

You're likely right, but I've gotten portable apps working in some pretty heavily restricted government and commerical SOEs (including at least one that flat-out banned executables network-wide). Now I do it just to show it can be done, since I BYOD. Unless you're using signal scramblers and/or banning smartphones and tablets from the workplace entirely, I can goof off on Facebook and shopping sites at will, SOE be damned.

I'll let you in on an online retailing secret... users with older browsers purchase >10 times less than their more modern counterparts.
A while back, a large online retailer I worked with had IE6 as 6% of traffic, but less than 0.2% of sales.
It literally cost more in developer time to fix IE bugs than those customers were worth.
If you're on a dated system... statistically, you're not a big spender.

say the website has total traffic of 10,000 visitors and 1,000 sales a month
600 of them are IE6 users
of those 600 only 2 purchase a product. That's a conversion rate of 0.33% compared to an overall conversion rate of 10%

The problem that they are making is that they are mixing conversion rate with the portion of sales, so what Greg was really saying is that people who use IE6 are 30 times less likely to make a purchase as users of other browsers.

why bother supporting ie7 at all and charging users? why not stop wasting your money in maintaining support and notify users that they cant access without upgrading their browser - simple, less expensive

is this some kinda "marketing" promotion from kogan for a little bit of nerdy shock and awe?

The notice said it was about making the internet a better place. I assume its actually meant to act as an incentive to make their users switch away from IE7, and that they don't expect users to pay the tax instead of changing browsers.

It's not wasting money, if people pay it. That's what businesses do: they give people what they want, in exchange for money. If there's people who want to pay more and use IE7, then Kogan can use that extra money and maintain IE7 support. It's also free advertising, but for anyone who takes him up on the offer, it's a real thing.

It's perfectly legal. They are being upfront about the policy and the reasons behind it. Even if they didn't, iIt's called a free market. In this case the customer is perfectly free to adapt to the rules or go somewhere else. And Kogan can discriminate however it likes so long as it's not by sex, race, etc as defined under the law. A lot of business change consultants call this "firing customers".

Oh but you have to be very careful with words, Max. The government plays this game all day every day.. for example, charging a tax on top of another tax.. such as say GST, is actually very much illegal.. so to get around this with relation to fuel, they call it a Fuel Excise so that they are clearly not charging a tax on top of another tax.

This is a fee. However, the word 'tax' sounds nastier, which is why they used in this ad. Also see the stamp "Department of Internet Justice". Newsflash for you - this is not a real government department.

Where Kogan can get away with it, they are NOT charging GST, because customers go to Kogan to get lower prices. And where they do have to charge it, GST is not money that they can make as profit because it is a tax. 10% of everything you buy goes to the government, not to Kogan or whatever retailer. Only the government imposes taxes, and all taxes go to the government.

If it makes your poor overwhelmed mind feel better, think of it as the IE7 Fee.

Go read your Australian Constitution some time.. this is the reason so many of us are being ripped off left, rigth and centre in this country. We are all too complacent and believe that our governments are doing the right thing.. but the facts don't lie... only politicians lie.

The BS with the carbon/mining tax is that everyone who earns more than that ends up paying for people who earn under that amount. In effect its just income redistribution. Might as well live in a communist country.

Wrong on both counts. A tax on a tax is not illegal. The Government cannot differentiate between a tax and an excise merely with a name. If it is calculated as a percentage of value (like the GST is 10% of the retail price) then it is a tax. If it is calculated based on the quantity of goods sold (like the petrol excise which is $0.38143 per L) then it is an excise.

Current legislation states that applying a tax on a product or service that is already taxed is against the law. Under the Australian Constitution that SUPERSEDES **ANY** OTHER LAW, a tax on a tax is illegal..

light487, you might be right that tax-ON-tax is illegal, but is tax-BY-tax illegal?
I mean, lets say I buy a pack of chips worth $5 before any taxes. And lets say there's a 10% GST, and a 10% potato-tax. Are you saying:
$5 + 50c + 50c is ok (since both 10%'s are calculated from the original value)
$5 + 50c = $5.50, then add another 10% of $5.50 so 55c = $6.05 is illegal ?

So, people crying that tax-on-tax exists are wrong ? Tax-BY-tax exists, and they should go back to Grade 5 maths and learn about compound interest?

Which is actually the same thing when you think about it. It might not be illegal, but that's only because of cercumventing technicalities. There has been no effort there to protect the people. The biggest effort Australian government makes is to profit from its people until they winge. A tax on tax is unethical. It's a 3rd world idea. Very young country, many countries to learn from. Learning from none of them. Too clever.

Just what i need, more people ringing me panicking over a tax they'll get now. Before you know it they'll have convinced themselves that this tax will be charged for everything they do on the god damn internet.

Kogan's got it wrong here. Just notify users that they need to update their web browser and point them to the updaters. Don't threaten them with a tax. Also. Put an upgrade link to IE as well you dumb asses. Many people are perfectly happy with IE for their browsing needs (which will not be most of the people here I know) but lots of mums and dads just use the first thing that gets to the Google which is normally IE. I train people not to click on random "Get me i'm better!!!!!111" links to help them avoid malware.

Ill-informed users may be happy with IE, but us developers aren't... we want to make the best looking most functional website for the customers and don't want the users to see a compromised version of the website... Things like, javascript/jqueary performance, rounded corners css uniformity don't work in IE..

I for one would be happy if the believe everything they do on the internet will incur this tax as then they will actually get good browser.

I was curious why they chose to pick on IE7 and not IE6 (which is infinitely more horrible), so I decided to try and buy something using IE6. Once you hit the checkout page the browser crashes completely, so I guess IE7 is the oldest IE version Kogan supports.

IE7 has significant problems with complying with CSS web standards. As both IE6 and 7 have reached EOF there's no reason to support either, unless you're in a corporate environment and have no choice due to legacy systems.

The line of code to detect a browser is literally 1 line of code in the html. It's even on this website, right at the top (in the code). The discount means I don't have to spend hours (there have been times when big websites have taken days to adapt to ie6/7/8) tweaking code to work for utterly outdated shit.

And before you say "develop in ie7 first then adapt to the others", think about how backwards that is. I've never met a developer who would even fathom this, but I'm sure there are some.

I don't remember the exact details, but in order to upgrade to IE9 you need windows 7 (perhaps Vista could work too). As default IE8 comes with windows 7. So if I'm not wrong, then it's a good chance that if you have IE7, your system can't support IE9. Not sure about other operative systems though, but they have other browsers as default.

My goodness, I wish I could do this. I hate how I have to jump through hoops to make our pages look reasonable on IE. Unfortunately, many of our clients are scientists working for large government and corporate departments that are forced to use IE6. Oh the humanity...

It's Ruslan doing what he does best, getting some free marketing by using his business as a platform for his geeky views and sensibilities.

Personally, I say good on him!

My guess is that this came about after a particular rendering glitch caused all sorts of problems after they had already made the decision to support IE7, and that they've already decided going forward that they won't support IE7 at all. In the meantime this is just an amusing stunt.

I'm not sure if this is legal. Doesn't this fall under discrimination because some not so tech savvy people are using older software?

Kogan should stop banking on marketing tactics of this nature but simply improve the quality of their products. I had a 42 inch LED TV which was a bit more than an year old, and stopped working completely. Good luck if any one is so desperate to buy Kogan stuff with added ridiculous taxes.

Illegal in the same way that a furniture store charges you more for delivery if you live further away from the store, as in not at all.

The man is just making the extra money he is forced to pay to deliver these services to these customers back off the customers who are causing the problem instead of marking up the cost for everyone so these people can still browse

Technically the government can call them up on it but they probably wont. It's not so much "illegal" as it is going on step towards getting the govt's attention, then they do a couple of hundred inquiries, and then 5 years later the come to the conclusion that maybe they should impose some sort of rule or fine to stop companies from ripping off the consumer.

So, for this, it's very unlikely they'd do something about it. But yes, it's a grey area. But the government has a weird approach to grey areas in that they will happily crack down if it's about morality or politically charged, but if it isn't they don't care. Older citizens tend to cop a lot because of that mind you.

Great idea Kogan.
I wouldn't see a legal issue with this at all. Kogan are simply re-couping costs incurred in maintaining this 'sales channel' (yes it does COST to support IE7 as a sales channel)., Similar to how an insurance company charges more to sign up over the phone rather than online.

Because when a website breaks in an old browser, people don't generally blame the browser but the website... so your choices are to a) silently accept that people are running outdated software and pay the extra development costs or b) brazenly put it out there that users should consider upgrading away from an obsolete and insecure browser...